Cool Car Motors assembles and sells motor vehicles and uses standard costing. Actual data relating to April and May 2014 are as follows:
The selling price per vehicle is $27000. The budgeted level of production used to calculate the budgeted fixed manufacturing cost per unit is 500 units. There are no price, efficiency, or spending variances. Any production-volume variance is written off to cost of goods sold in the month in which it occurs.
Requirements:
Prepare April and May 2014 income statements for Cool Car Motors under (a) variable costing and (b) absorption costing.
Prepare a numerical reconciliation and explanation of the difference between operating income for each month under variable costing and absorption costing.
Unit data April May
Beginning Inventory 0 100
Production 500 425
Sales 400 495
Variable Costs
Manufacturing cost/unit produced $11000 $11000
Operating (marketing) cost/unit sold 3200 3200
Fixed costs
Manufacturing costs $2000000 $2000000
Operating (marketing) costs 550000 550000

Answer:

Cool Car Motors

Income statements for April and May - variable costing

                                                       April                               May

Sales ($27000)                       $10,800,000                $13,365,000

Less Cost of Sales                  ($4,400,000)               ($5,445,000)

Contribution                             $6,400,000                 $7,920,000

Less Expenses :

Fixed Manufacturing costs     ($2,000,000)               ($2,000,000)

Operating (marketing) costs :

Variable ($3200)                      ($1,280,000)               ($1,584,000)

Fixed                                           ($550,000)                 ($550,000)

Net Income / (Loss)                   $2,570,000                $3,786,000

Cool Car Motors

Income statements for April and May - Absorption costing

                                                       April                               May

Sales ($27000)                       $10,800,000                $13,365,000

Less Cost of Sales                  ($6,000,000)               ($7,425,000)

Gross Profit                              $4,800,000                 $5,940,000

Less Expenses :

Operating (marketing) costs :

Variable ($3200)                      ($1,280,000)               ($1,584,000)

Fixed                                           ($550,000)                 ($550,000)

Net Income / (Loss)                   $2,970,000                $3,806,000

Cool Car Motors

Reconciliation of Absorption Costing Profit to Variable Costing Profit

                                                                             April                      May

Absorption Costing Income                        $2,970,000                $3,806,000

Add Fixed Costs in Opening Inventory             $0                           $400,000

Less Fixed Cost in Closing Inventory          ($400,000)                  ($120,000)

Variable Costing Income                             $2,570,000                $3,786,000

Explanation : The Fixed Costs deferred in closing inventory is the cause of the difference between operating income for each month under variable costing and absorption costing.

Explanation:

Summary of Units

                                               April          May

Beginning Inventory                0              100

Add Production                      500           425

Available for Sale                   500           525

Less Sales                              (400)         (495)

Ending Inventory                     100             30

Variable Costing Calculations :

                                                                                April               May

Cost of Sales

Beginning Inventory at $11000                              $0           $1,100,000

Manufacturing Cost at $11000                       $5,500,000   $4,675,000

Ending Inventory at $11000                            ($1,100,000)   ($330,000)

Cost of Sales                                                   $4,400,000  $5,445,000

Absorption Costing Calculations :

                                                                               April                May

Cost of Sales

Beginning Inventory at $15000                              $0           $1,500,000

Manufacturing Cost at $15000                       $7,500,000   $6,375,000

Ending Inventory at $15000                            ($1,500,000)   ($450,000)

Cost of Sales                                                    $6,000,000    $7,425,000

Pasadena Candle Inc. budgeted production of 715,000 candles for the January. Wax is required to produce a candle. Assume 10 ounces of wax is required for each candle. The estimated January 1 wax inventory is 18,600 pounds. The desired January 31 wax inventory is 12,800 pounds. If candle wax costs $2.10 per pound, determine the direct materials purchases budget for January. (One pound = 16 ounces.) Round all computed answers to the nearest whole number. For those boxes in which you must enter subtracted or negative numbers use a minus sign.

The minimum downside projection from a head and shoulders top pattern is derived a. by projecting downward from the neckline, the vertical distance from the top of the head to the neckline b. by measuring the width of the left shoulder and subtracting that distance from the neckline c. by measuring the distance from the penetration of the neckline by the left shoulder to the penetration of the neckline by the right shoulder and extending down from the point of penetration of the right shoulder d. by estimating the length of the primary price cycle

Microsoft develops, produces, and markets a wide range of computer software, including the Windows operating system. On its recent financial statements, Microsoft reported the following information about net sales revenue and accounts receivable (amounts in millions).

Current Year Prior Year
Accounts receivable, net of allowances of $405 and $426 $19,792 $18,277
Net sales revenue 89,950 85,320


According to its Form 10-K, Microsoft recorded bad debt expense of $14 and there were no bad debt recoveries during the current year.

Required:
What amount of bad debts was written off during the current year?

Lewis Bros. currently has outstanding debt but has decided to issue additional debt for expansion purposes. The pretax cost of the new debt is best estimated at the ________ of the currently outstanding debt.

The Johnson Materials Inc. has an EBIT of $3,500,000. Its Times Interest Earned (TIE) ratio is 5, Profit Margin is 16% and the tax rate is 35%. Costs of Goods Sold (COGS) is $6 million. Develop an income statement by filling in the blanks in the following table:


Sales = _________
COGS = 6000000
EBITDA =
Depreciation & amortization=
EBIT= 3500000
Interest Expense =
EBT =
Tax =
Net Income =

Gitano Products operates a job-order costing system and applies overhead cost to jobs on the basis of direct materials used in production (not on the basis of raw materials purchased). Its predetermined overhead rate was based on a cost formula that estimated $128,800 of manufacturing overhead for an estimated allocation base of $92,000 direct material dollars to be used in production. The company has provided the following data for the just completed year:
Purchase of raw materials $ 136,000
Direct labor cost $ 88,000
Manufacturing overhead costs:
Indirect labor $ 136,100
Property taxes $ 8,200
Depreciation of equipment $ 19,000
Maintenance $ 12,000
Insurance $ 7,400
Rent, building $ 32,000
Beginning Ending
Raw Materials $ 27,000 $ 13,000
Work in Process $ 49,000 $ 37,000
Finished Goods $ 69,000 $ 55,000
Required:
1. Compute the predetermined overhead rate for the year.
2. Compute the amount of underapplied or overapplied overhead for the year.
3. Prepare a schedule of cost of goods manufactured for the year. Assume all raw materials are used in production as direct materials.
4. Compute the unadjusted cost of goods sold for the year. Do not include any underapplied or overapplied overhead in your answer.
5. Assume that the $37,000 ending balance in Work in Process includes $8,000 of direct materials. Given this assumption, supply the information missing below:
Required 1 Required 2 Required 3 Required 4 Required 5
Compute the predetermined overhead rate for the year. 19% redetermined overhead rate

Professionalism is a skill necessary for......

Amazon.com, Inc., headquartered in Seattle, WA, started its electronic commerce business in 1995 and expanded rapidly. The following transactions occurred during a recent year (dollars in millions):
Issued stock for $6 cash.
Purchased equipment costing $6,320, paying $4,893 in cash and charging the rest on account.
Paid $513 in principal and $91 in interest expense on long-term debt.
Earned $88,988 in sales revenue; collected $87,949 in cash with the customers owing the rest on account.
Incurred $10,766 in shipping expenses, all on credit.
Paid $28,241 cash on accounts owed to suppliers.
Incurred $4,332 in marketing expenses; paid cash.
Collected $620 in cash from customers paying on account.
Borrowed $6,359 in cash as long-term debt.
Used inventory costing $62,752 when sold to customers. Paid $177 in income tax recorded as an expense in the prior year.
For each of the transactions, indicate the effects (positive value for increase, negative value for decrease, and leave blank if no effect) on Income Statement and Balance Sheet.

Chicago's Hard Rock Hotel distributes a mean of 1,000 bath towels per day to guests at the pool and in their rooms. This demand is normally distributed with a standard deviation of 100 towels per day, based on occupancy. The laundry firm that has the linens contract requires a 2-day lead time. The hotel expects a 98% service level to satisfy high guest expectations.


Required:
a. What is the reorder​ point?
b. What is the safety stock?
c. What is the ROP?

Forest Components makes aircraft parts. The following transactions occurred in July.

1. Purchased $119,000 of materials on account.
2. Issued $117,600 in direct materials to the production department.
3. Issued $8,400 of supplies from the materials inventory.
4. Direct labor employees earned $217,000, which was paid in cash.
5. Purchased miscellaneous items for the manufacturing plant for $120,400 on account.
6. Recognized depreciation on manufacturing plant of $245,000.
7. Applied manufacturing overhead for the month.
8. Job X that cost $533,000 was completed.
9. Some units in Job X, that cost $521,500, were sold for $800,000 cash.
10. After all of the previous transactions posted, the Manufacturing overhead control account shows a debit balance of $373,800, and the Applied manufacturing overhead account shows a credit balance of $201,800. The over- or under-applied overhead was closed to Cost of goods sold. Forest uses normal costing. It applies overhead on the basis of direct labor costs using an annual, predetermined rate. At the beginning of the year, management estimated that direct labor costs for the year would be $3,000,000. Estimated overhead for the year was $2,790,000.

Required:
a. Prepare T-accounts to show the flow of costs during the period from Materials Inventory through Cost of Goods Sold.
b. Prepare journal entries to record these transactions.

The following trial balance of Pronghorn Traveler Corporation does not balance. Pronghorn Traveler Corporation Trial Balance April 30, 2020 Debit Credit Cash $6,632 Accounts Receivable 5,600 Supplies 3,327 Equipment 6,460 Accounts Payable $7,404 Common Stock 8,360 Retained Earnings 2,360 Service Revenue 5,560 Office Expense 4,680 $26,699 $23,684 An examination of the ledger shows these errors.
1. Cash received from a customer on account was recorded (both debit and credit) as $1,940 instead of $2,210.
2. The purchase on account of a computer costing $3,080 was recorded as a debit to Office Expense and a credit to Accounts Payable.
3. Services were performed on account for a client, $2,610, for which Accounts Receivable was debited $2,610 and Service Revenue was credited $585.
4. A payment of $455 for telephone charges was entered as a debit to Office Expense and a debit to Cash.
5. The Service Revenue account was totaled at $5,560 instead of $5,640.

Prepare the journal entries to record the following transactions on Sunland Company's books using a perpetual inventory system.

a. On March 2, Splish Brothers Company sold $885,600 of merchandise to Sunland Company on account, terms 2/10, n/30. The cost of the merchandise sold was $519,500.
b. On March 6, Sunland Company returned $110,200 of the merchandise purchased on March 2. The cost of the merchandise returned was $63,000.
c. On March 12, Splish Brothers Company received the balance due from Sunland Company.

Digger Inc. sells a high-speed retrieval system for mining information. It provides the following information for the year.
Budgeted Actual Overhead cost $975,000 $950,000
Machine hours 50,000 45,000
Direct labor hours 100,000 92,000
Overhead is applied on the basis of direct labor hours.
A) Compute the predetermined overhead rate. (Round answer to 2 decimal places, e.g. 12.25.) Pre-determined overhead rate = budgeted overhead / budgeted direct labor hours
= 975,000 / 100,000
= $9.75 per direct labor hoursB) Determine the amount of overhead applied for the year.?overhead applied = actual hours *overhead rate = 92000 * 9.75
= $897,000C) Explain how an activity-based costing system might differ in terms of computing a predetermined overhead rate.

Consider an economy that is composed of identical individuals who live for two periods. These individuals have preferences over consumption in periods 1 and 2 given by U = ln(C1) + ln(C2). They receive an income of 100 in period 1 and an income of 50 in period 2. They can save as much of their income as they like in bank accounts, earning an interest rate of 10% per period. They do not care about their children, so they spend all their money before the end of period 2.
Each individual’s lifetime budget constraint is given by C1 + C2/(1 + r) = Y1 + Y2/(1 + r). Individuals choose consumption in each period by maximizing lifetime utility subject to this lifetime budget constraint.
What is the individual’s optimal consumption in each period? How much saving does he or she do in the first period?
Now the government decides to set up a social security system. This system will take $10 from each individual in the first period, put it in the bank, and transfer it to him or her with interest in the second period. Write out the new lifetime budget constraint. How does the system affect the amount of private savings? How does the system affect national savings (total savings in society)? What is the name for this type of social security system?

The following terms relate to the fundamental qualities of useful information. Match the key letter of the correct term with the descriptive statement below. a. Confirmatory value b. Faithful representation c. Neutral d. Timely e. Predictive value f. Verifiable g. Relevant 1. Providing information that is not biased toward one position or another. select a letter 2. Providing information before it loses its capacity to influence decisions. select a letter 3. Providing information that is proven to be free from error. select a letter 4. Providing information that would make a difference in a business decision. select a letter 5. Provide information that accurately depicts what really happened. select a letter 6. Providing information that confirms or corrects prior decisions.

SNC has its own, modest internet-based business. However, the company has been approached by Golden Years Nutraceuticals, a much larger online distributor of third-party brands with connections to a national healthcare website endorsed by a leading senior advocacy association. Therefore, Golden Years reaches a large-and increasing-consumer base of older Americans. This opportunity would generate an additional 10% increase in sales in 2016, followed by increases of 5% in 2017 and 3% in 2018. Increasing the percentage of SNC's business that is conducted online would decrease DSO, because internet sales are collected very quickly. Accounts receivable would decrease by 7 days in the first year and by an additional 3 days in 2017, for a total improvement of 10 days. In 2018, the DSO would decline by another 2 days-in effect, 12 days lower than at the start of 2016. Going forward, the DSO would stay at this lower level and SNC's profit margin would remain unchanged. What would you like to do about this opportunity?
Accept or Decline
2016 2017 2018 Post 2018
Incremental Summary Income Statement ($ in thousands)
Change in Sales $1,600 $2,480 $3,034 $3,034
Change in Cost of Sales $1,492 $2,313 $2,830 $2,830
Change in EBIT $108 $167 $204 $204
Incremental Balance Sheet ($ in thousands)
Change in Accounts Receivable $145 $241 $289 $289
Change in Inventories $368 $570 $698 $698
Change in Accounts Payable $162 $251 $307 $307

An employee's skills is provided to businesses in which market in the circular flow
model?

A company had the following assets and liabilities at the beginning and end of this year.
Assets Liabilities
Beginning of the year $ 109,500 $ 46,943
End of the year 169,000 68,445
a. Owner made no investments in the business, and no dividends were paid during the year.
b. Owner made no investments in the business, but dividends were $1,450 cash per month.
c. No dividends were paid during the year, but the owner did invest an additional $45,000 cash in exchange for common stock.
d. Dividends were $1,450 cash per month, and the owner invested an additional $35,000 cash in exchange for common stock.
Determine the net income earned or net loss incurred by the business during the year for each of the above separate cases:
(Decreases in equity should be indicated with a minus sign.)
a. b. c. d.
Beginning of the year

Business-process outsourcing (BPO) is a type of outsourcing that consists of contracting operations and responsibilities of a specific business process (e.g.,human resources) to a third party service provider. Such outsourcing generally began with manufacturing firms outsourcing your supply chain but has grown into a much wider range of process, including marketing, finance, sales, and accounting. According to a recent Frobes articles, the revenue of the globe outsourced services Industry rose from 45 billion in 2000 to nearly 100,000,000,000 in 2012. Competition among firms in that BPO market is strong. Companies based in the United States include HP enterprise services, affiliated come to Peterson services, an automated data processing (ADP). A number of Indian companies, however, also provide worldwide BPO services, such as Infosys, Wipro, and Genpact. An article in business wk. suggested that BPL can save and users anywhere from 15 to 85%. International BPO service providers are particularly attractive says offshore labor I first an additional 25 to 30% cost savings. Furthermore, approximately 25% of the cost savings result from BPO firms proprietary products. The remaining 10% to 30% in cost reduction accrues from consolidated operations. Suppose you are the manager of a U.S.-based company and must decide whether to outsource your human resources department. Based on the above information and your study, please outline arguments supporting and opposing a decision to outsource this function of your business. Please explain from a purely business standpoint, any issues that might arise from contracting with an international-based versus U.S.-based BPO service firm? Explain.

helpp please 10 points!

2. What are Internal and external factors.

Compare this to Case 16, a case that resulted in a legislative change requested by an advocacy group after a fatal event. In this instance, the family is looking to effect change via the political process. However, this approach is rarely successful. Do you think the concepts of social marketing could be used in this instance or one like it? What are the six basic steps of social marketing?

Acton Quest Games Inc. adjust accounts annually. The following information is available for the year ended December 31, 2017.

Purchased a 1-year insurance policy on June 1 for $1,320 cash.
Paid $6,100 on August 31 for 5 months' rent in advance.
On September 4, received $3,240 cash in advance from e corporation to sponsor a game each month for a total of 9 months for the most improved students at local school.
Signed a contract for cleaning services starting December 1 for $1,150 per month. Paid for the first 2 months on November 30. (Hint: use the account Prepaid Cleaning to record
On December S, received $2,600 in advance from a gaming dub. Determined that on December 32, $350 of these games had not yet been played.

Required:
For each of the above transactions, record the adjustment that is required on December 31.

Compute Net Operating Assets Selected balance sheet and income statement information for Home Depot follows.
$ millions Jan. 31, 2016 Feb. 01, 2015
Operating assets $40,583 $38,473
Nonoperating assets 2,241 1,748
Total assets 42,824 40,221
Operating liabilities 15,018 13,527
Nonoperating liabilities 21,340 17,222
Total liabilities 36,358 30,749
Sales 88,944
Net operating profit before tax (NOPBT) 12,024
Nonoperting expense before tax 778
Tax expense 4,208
Net income 7,038
Compute net operating assets for the years ended January 31, 2016 and February 1, 2015.
2016 NOA $Answer
2015 NOA $Answer 0

What designation would you hold if you have the most common designation in the accounting field, which is also considered the backbone of the accounting function?

Pizza Express Inc. began the Year 2 accounting period with $2,500 cash, $1,400 of common stock, and $1,100 of retained earnings. Pizza Express was affected by the following accounting events during Year 2:

1. Purchased $3,600 of supplies on account.
2. Earned and collected $12,300 of cash revenue.
3. Paid $2,700 cash on accounts payable.
4. Adjusted the records to reflect the use of supplies. A physical count indicated that $250 of supplies was still on hand on December 31, Year 2.

Required
a. Show the effects of the events on the financial statements.
b. Explain the difference between the amount of net income and amount of net cash flow from operating activities.

Belden, Inc. acquires 30 percent of the outstanding voting shares of Sheffield, Inc. on January 1, 2017, for $320,000, which gives Belden the ability to significantly influence Sheffield. Sheffield has a net book value of $828,000 at January 1, 2017. Sheffield's asset and liability accounts showed carrying amounts considered equal to fair values except for a copyright whose value accounted for Belden's excess cost over book value in its 30 percent purchase. The copyright had a remaining life of 16 years at January 1, 2017. No goodwill resulted from Belden's share purchase.

Sheffield reported net income of $180,000 in 2017 and S230,000 of net income during 2018. Dividends of $70,000 and $80,000 are declared and paid in 2017 and 2018, respectively. Belden uses the equity method.

a. On its 2018 comparative income statements, how much income would Belden report for 2017 and 2018 in connection with the company's investment in Sheffield?
b. If Belden sells its entire investment in Sheffield on January 1, 2019, for S400,000 cash, what is the impact on Belden's income?
c. Assume that Belden sells inventory to Sheffield during 2017 and 2018 as follows:


Year Cost to Belden Price to Sheffield Year-End Balance (at Transfer Price)
2017 $29,700 $54,000 $18,000 (sold in following year)
2018 29,500 59,000 40,000 (sold in following year)


d. What amount of equity income should Belden recognize for the year 2018?

The prepaid insurance account shows a debit of $6,336, representing the cost of a 2-year fire insurance policy dated August 1 of the current year. 2.
On November 1. Rent Revenue was credited for $1,809, representing revenue
from a subrental for a 3-month period beginning on that date.
3. Purchase of advertising materials for $767 during the year was
recorded in the Advertising Expense account.
On December 31. Advertising materials of $277 are on hand.
4. Interest of $714 has accrued on notes payable. The interest will
be paid in January of the next year.
Instructions:
Prepare the following in general journal form.
A) The adjusting entry for each item.
B) The reversing entry for each item where appropriate.

The following transactions pertain to year 1, the first-year operations of Campbell Company. All inventory was started and completed during year 1. Assume that all transactions are cash transactions.
Acquired $4,700 cash by issuing common stock.
Paid $630 for materials used to produce inventory.
Paid $1,940 to production workers.
Paid $1,210 rental fee for production equipment.
Paid $120 to administrative employees.
Paid $116 rental fee for administrative office equipment.
Produced 360 units of inventory of which 260 units were sold at a price of $13 each.
RequiredPrepare an income statement and a balance sheet in accordance with GAAP.

5. Problems and Applications Q5 In the 1990s and the first two decades of the 2000s, investors from the Asian economies of Japan and China made significant direct and portfolio investments in the United States. At the time, many Americans were unhappy that this investment was occurring. True or False: It was better for the United States not to receive this foreign investment because it shrank the capital stock. True False True or False: It's best for Americans that China and Japan, rather than Americans themselves, made the investment, so that Americans can have more to spend on consumption. True False

Recording sales, purchases, shipping, and returns—buyer and seller LO P1, P2
Sydney Retailing (buyer) and Troy Wholesalers (seller) enter into the following transactions.
May
11 Sydney accepts delivery of $29,500 of merchandise it purchases for resale from Troy: invoice dated May 11, terms 3/10, n/90, FOB shipping point. The goods cost Troy $19,765. Sydney pays $590 cash to Express Shipping for delivery charges on the merchandise.
12 Sydney returns $1,200 of the $29,500 of goods to Troy, who receives them the same day and restores them to its inventory. The returned goods had cost Troy $804.
20 Sydney pays Troy for the amount owed. Troy receives the cash immediately.
(Both Sydney and Troy use a perpetual inventory system and the gross method.)
1. Prepare journal entries that Sydney Retailing (buyer) records for these three transactions.
2. Prepare journal entries that Troy Wholesalers (seller) records for these three transactions.